Measuring the Macroeconomic Objectives: Economic Growth, Unemployment and Inflation
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Macroeconomics provides government policymakers with a set of tools that can be employed to help achieve certain macroeconomic objectives deemed desirable for a nation. For an economy to be considered healthy, three objectives must be met: -Economic growth: defined as an increase in the nation's output of goods and services over time -Low unemployment: meaning that nearly everyone who is willing and able to work should be able to find a job, and -Low inflation: meaning that the average price level of the nation's goods and services should not increase too rapidly over time. Measuring these three objectives requires the use of some simple mathematical formulas. Once they are known, we can use the basic production possibilities curve diagram to illustrate their effect on a nation's potential output and its current equilibrium level of output. This lesson will define the three macroeconomic objectives, show how it can be determined whether or not they are being achieved, and use a PPC model to illustrate them. Once you've watched this video, download and attempt the following worksheet: Macroeconomic Objectives Practice Activity http://www.econclassroom.com/?p=3159
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nice
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Thank you very much for the video, is it possible if you could go through the lorenz curve and Gini Index. Also, some measures for microeconomics objectives would be great THANKS :D
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This is awesome.....
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way better than my economics teacher overcomplicated explanation
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it helps alot.Thanks
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wow, best explanation ever
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You are the best, BIG ups to you.
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thank you
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thank you
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If a nation is producing at full employment, then it is achieving its potential output. An outward shift of the PPC illustrates an increase in potential output, and if a nation achieves that potential, and the potential grows, then economic growth is also achieved. New technology is attained through investment, Investment leads to economic growth. Therefore, new technology which shifts PPC outward leads to growth. Let's end this discussion. PS. Do you live in Switzerland?
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There is no error in the video. It says "economic growth can be shown by shifting the PPC outwards" It does not say "GDP growth CAUSES the PPC to shift outwards". However, if Switzerland had been at its full employment level (in other words, on or very close to its PPC) in 2009, and its GDP increased by 2% between 2009 and 2010, then this would corresponded with an outward shift in the PPC. If the nation's workforce grows or technology improves, then both potential and actual output can increase
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